Legacy planning explained Part I Roy Kozupsky
Meeting Roy Kozupsky
Roy Kozupsky
Roykozupsky.wordpress.com
Steward & Tought Leader
Roy Kozupsky
Roykozupsky.wordpress.com
Steward & Tought Leader
Legacy planning explained Part I Roy Kozupsky This is the first half of an article I have written. I often get asked by clients some form of the following two questions: “Why is it that many families fulfill the proverb of shirtsleeves to shirtsleeves by descending into intra-family conflict or plundering the wealth bestowed on the family by an earlier generation?” And, “Why is it that some second and third generations of other families are able to perpetuate their core values staying united by the fabric of their family’s shared values and whose next generations are flourishing into thought leaders in their businesses and philanthropic endeavors?” These multi-generational families are called Legacy Families, and they have a few characteristics that clients and their advisors need to be mindful of. My answer to the first question is this: Some research suggests a deep failure of family communications, but quite frankly, I really don’t know. The reasons are complex and different for all families – greed, consumptive behavior, a lack of shared values to sustain some type of union. Take your pick. My non-scientific answer to the second question about why some families flourish into Legacy Families is simple – because they want to become one and they work hard at being one. The commitment to begin such a long term family journey or to preserve being a Legacy Family allows all advisors to peek through the family’s front window and to get a glimpse of their behavioral thinking surrounding subtle family issues, their values concerning wealth and money and the advisory services they value.
Roy Kozupsky
Roykozupsky.wordpress.com
Steward & Tought Leader
Luckily there is a growing body of research for family advisors working in this area to get a better understanding of the common characteristics of Legacy Families. Understanding their characteristics has important value to families that are beginning this journey and to a wide audience of family advisors who seek to help families navigate this terrain. So, what are the common threads of these Legacy Families? First, Legacy Families understand that the true wealth and health of a family is not measured by the size of its balance sheet. The real assets of a family are its highly cherished individual members. Collectively they are the petrol in the tank propelling the commitment, innovation and growth for their collective enterprises. Next, Legacy Families have taken the time to collaboratively think through their family’s mission. These families understand that they must form a social compact reflecting their shared values and visions. Different generations will have behavioral traits and different visons making this process of listening to different voices critical. (insert link to power point) Mission is not defined in the traditional estate planning sense of how little is paid in estate taxes. Death and estate transfer taxes are indeed important to understand and plan for. Rather, Legacy planning asks a broader set of questions that these families want to explore related to the best practices, including governance strategies, family organization and goals to sustain its members, its businesses and its philanthropic enterprises over many generations. “These generative families have discovered that having family wealth is only the beginning. The question to be answered by each successive generation is, ‘What do we want to do with the Family Wealth?’ Each generation develops a shared purpose that motivates family members to become more than passive, disinterested consumers of the family wealth”. Many have observed that Legacy Families work very hard at thinking through these family issues: they understand that their chances of succeeding are directly proportional to the level of planning and execution. They hire the right attorneys and other advisors skilled and schooled in this area of family advisory work.
Roy Kozupsky
Roykozupsky.wordpress.com
Steward & Tought Leader